April 15, 2021 | Mario Toneguzzi
Out of office: Royal LePage predicts price increases for Alberta vacation properties in 2021, as COVID-19 continues to drive up demand
More than a year after it began, the COVID-19 pandemic continues to spark increased interest in Alberta's recreational property market, as homebuyers seek an escape from congested cities.
Long-term remote work, which has been a reality for many Albertans for the last 12-plus months, has also made people realize that if they can work from anywhere, why not work from a cottage, cabin or waterfront property?
This increase in demand, combined with a shortage of supply, has prices on the upswing across the Alberta market.
According to a recent Royal LePage Canada report
, the aggregate price of a house in Alberta's recreational regions is forecast to increase six per cent in 2021 to $942,881. In 2020, the aggregate price of a house in the province's recreational markets increased 9.5 per cent year-over-year to $889,510. Meanwhile, the Canada-wide figure is forecast to rise by 15 per cent this year.
"People are focused on the three Ps of the pandemic: puppies, Peloton and property," said Phil Soper, president and CEO of Royal LePage. "Property appreciated rapidly as people put a lot of focus on their home.
"You see a bump in prices in urban, a bigger bump in suburbs and a great big bump in recreational properties. It has become very, very valuable and very sought after during these strange times."
Soper says recreational property has traditionally been a limited market. In Alberta, it's usually all about either great views or waterfront and there is very little supply.
"Now people are saying, 'I can work from anywhere, perhaps I should acquire recreational property and turn that into my principal residence and work from there.' There's just too many city people looking for too few country properties," he said.
"People are focused on the three Ps of the pandemic: puppies, Peloton and property. Property appreciated rapidly as people put a lot of focus on their home." - Phil Soper, Royal LePage president and CEO
Brad Hawker, REALTOR®
and managing broker with Royal LePage Rocky Mountain Realty, says Canmore is seeing unparalleled demand from people wanting to accelerate their life plans and focus on their physical and mental health.
"We've seen a growing segment of young and middle-aged buyers seeking primary residences in the area," he said. "If they can work remotely from anywhere, they want to live in a place that caters to their active and adventurous lifestyles."
According to a Royal LePage survey of recreational property experts, 44 per cent of respondents in Alberta reported an increase in the number of buyers from other provinces compared to previous years. Demand and prices continue to grow in recreational regions easily accessible from Edmonton and Calgary. Experts in Alberta say 78 per cent of recreational markets have seen a decline in inventory compared to what is typical for their respective regions, the report adds.
According to the Royal LePage 2021 Demographic Survey, 32 per cent of Albertans aged 25 to 35 say the pandemic has increased their desire to move to a less dense area and 60 per cent say it is important to work for an employer that allows them to work remotely.
Soper says the evolution of the Internet, which has allowed more people to work from home in an efficient and effective way, has been an important development.
"If you look at the evolution of the primary needs when someone was looking at acquiring a cottage or a cabin, it used to be they wanted to understand the quality of the water or the well, or what the septic system is like," he said. "Now the No. 1 question our people in the field are getting is, 'What's the nature of the Internet in this area? Can I do not just downloading to watch Netflix, but uploading? Do I have the speeds that I can have a business conversation?'
"The good news is the pandemic arrived at a time when the quality of our connectivity really was going north and we're on the verge of the widespread availability of 5G."
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